Divorce can be a difficult experience for everyone involved. Given how much is often at stake when it comes to divorce, it is no surprise that divorce is often ranked as one of life’s most stressful experiences. Buying a home is also often found on that list. When the two concerns are combined, people may face a great many pitfalls and other difficulties that can be hard to approach.
A recent Florida Today article sheds some light on common issues some people face when looking into purchasing a home after divorce. The article provides some helpful hints for buying a home after divorce and how to begin discussions about the process with your attorney.
Pay Attention to Your Debt
As you would probably expect, any lender considering an application for a home loan is going to check your credit. That means you need to have a good idea of what your credit looks like before, during, and after the divorce. Understanding exactly how much debt you are carrying is part of a responsible approach to credit because it can help you plan for exactly how much additional debt you are able to and/or willing to take on.
Divorce can impact your credit score significantly, especially since marital debt can be divided in a less-than-equal manner. Most of the time, any joint debt will be reported to credit bureaus in the name of both spouses even if a divorce settlement has assigned one spouse to pay off a particular debt. That means you will need to monitor joint debts until they are settled, which includes keeping a close watch on your own credit report to catch any red flags that have the potential to become major hindrances.
Address Existing Property Concerns
Exactly how existing property will be divided and dealt with will depend on the unique circumstances of your divorce and the related divorce settlement. It is not uncommon for couples to elect selling the marital home and splitting profits according to the divorce agreement. Either both former spouses will move out of the home and wait for it to sell or one spouse may remain in the home until a sale is final.
However, it is also possible for one spouse to retain the marital home indefinitely. When that happens, it is important to make sure that the terms of dividing property in this manner specify that the spouse retaining the home will refinances that home solely in his or her name. Having a mortgage attached to your credit can hinder you credit score depending on the status of mortgage payments. It can also significantly limit the amount some lenders are willing to extend to you, or could have a negative effect on any potential interest rates offered to you.
Know What Your Credit May Impact
Most people know that credit can have a significant impact on one’s finances. However, credit can affect more than just your bank account and buying power. It can have an indirect effect on these things by directly affecting potential employment opportunities that may be based on your credit strength. Credit can even impact background checks, security clearances, and other aspects of your professional life that you may not be aware of.
Negative items on your credit report will usually remain there for seven years, even if you are able to address the underlying cause of those negative items. That is why it is so important to communicate with former spouses on matters of shared financial interest in an attempt to be proactive and avoid issues before they arise. An experienced Florida divorce attorney can help you understand the import role credit will play in your divorce as well as afterwards, and can help you anticipate challenges so that you are better prepared to meet them.
Have a Clear and Detailed Agreement
One of the most important aspects of any potential divorce agreement is the details of that agreement. It is important to work with an attorney to make sure that a divorce agreement has not left any loose ends. In other words, your agreement should specifically spell out the exact terms of property distribution, including distribution of debt. There should be no uncertainty in your agreement as to who is responsible for what terms within that agreement.
Even in situations in which both spouses continue to communicate effectively, the terms of an agreement should be specific. When individuals no longer reside in the same house, communication can continue but may not be as thorough as it once was. A detailed agreement can provide each spouse with a framework for his or her responsibilities, and at the same time can effectively provide each spouse important peace of mind.
As with most things in life and especially with divorce, preparation goes a long way. Preparing to meet challenges ahead of time can help relieve a lot of the stress those challenges can bring. Preparation can also help make sure you have the time and knowledge to understand your rights as well as advocate for them.
An important part of being prepared is often building a successful relationship with an experienced Florida divorce attorney. By discussing your goals as well as your needs with an experienced Florida divorce attorney, you and your attorney can work together on a thorough and dynamic approach toward negotiating a divorce settlement that is fair and acceptable for all parties. If you have questions about how divorce might affect you and your future, contact Scott J. Stadler to schedule a consultation and find out more about the options that might be available for you.